Disclaimer: I am not a tax, finance, or legal professional and nothing on the site is tax, finance, or legal advice.

You might think you don’t have a business and so there is no point to read this post – but please give this one a second chance!

Why Business Cards Matter

While applying for and earning SUBs on personal cards is a great start, expanding your repertoire to business cards is the best way to level up your game. There are a few major reasons for this:

• Business cards generally don’t count against your 5/24 status because they typically don’t report to your personal credit (although you still need good personal credit to get approved)
• Business cards often have great SUBs, albeit sometimes the minimum spend requirements are higher than for personal cards
• Pursuing business cards means you will have about double the options when you look for your next card 🙂
• Major banks offer business cards that earn transferable points

Do You Have A Business?

Most people think they don’t have a business, but most people engage in activities that qualify as a business. How so? Simply stated, a business is some activity that you do or plan to do with the intent of making a profit. Below are a few ideas of activities that would constitute a business:

• Babysitting
• Consulting
• Reselling/Wholesale
• Lawn Mowing
• eBay Seller
• Etsy Seller
• Facebook Marketplace Seller
• Dog Walker
• Uber Driver
• Door Dash Driver
• AirBnB Renter

It’s possible you are already doing more than one of these and thus own a business. If not, it is easy to start and there are really good reasons to have business credit cards if you have a profit making side hustle. These include the ability to optimize your spend, separating business and personal finances, and getting benefits on potentially useful business-related costs.

Before I opened my first business credit card, I set up an Etsy site to sell cross-stitch patterns on. I put a ton of time and energy into my shop and it is still up and running today – mostly passively. I probably had a revenue of about $12 when I opened up my first business card and have used this Etsy site as my primary business for all my business credit cards since then! I have a few other side hustles that might make more sense to use than my Etsy shop because they make more money, but why change something that isn’t broken? I actually went through the process of getting my free EIN (kind of like the social security number for a business), although I have never once used it. Needless to say, I wanted to go all in and do things “right” before I applied for my first business credit card.

Looking back, I am proud of my Etsy shop, but I didn’t have to have all my ducks in a row before beginning to apply for business cards. The application process is very simple – you will apply as a sole proprietor with your SSN, report your household income, your expected business revenue, expected business costs, and select a business type that best describes what you do. More than likely you will submit your application and get an automatic decision. For two of my business credit card applications, I have had to talk to a representative and answer some basic questions – primarily the exact same questions from the application and sometimes provide an answer to why I need another card if I already have one. For this type of questioning, I just pick some benefit of the card that I like (other than earning the big SUB) and highlight how the benefit is different, but important to me.

I have heard of some people randomly being asked for supporting documentation before being approved for a business card, but I believe this is usually who are reporting really large revenues or costs. In these cases, the bank may ask for tax forms to make sure that what you are reporting is consistent with what you are reporting on your taxes. While I am not a tax professional, you should consult your own tax professional about how to report your taxes for your business.

Business Spend vs Personal Spend

There is some language in the business credit card applications regarding only using business spend on the business card. While in some cases I put tons of business spend on my cards (reselling activities), other times I do not. While I am not a tax, finance, or legal professional and can’t give any advice on these topics, I haven’t personally had any issues with putting personal spend on a business credit card. The credit card company has no real insight into what is personal vs business spend, does not report anything to the IRS, and probably includes this language on applications for their own protection. Obviously, please seek out professional advice if you are concerned and do what is best for your situation.

Conclusion

Two years ago when I got deep into points and miles for the second time, I also decided to kick off my Etsy side hustle so that I could be eligible for business cards. I really didn’t think it would be so easy to qualify for a business, but these days my wallet is filled with business cards. As of this writing, I have 14 open cards and only 3 are personal cards. In fact, I have only opened one personal cards this year. There are a few personal cards I want to get soon, but I have tried to stay under 5/24, and business cards has been an easy way to do that while still earning lots of points and miles! I also have to laugh that in the two years since I have returned to points and miles, I now have 3-4 side hustles that would qualify for businesses!

If you want to open a business card, take some time to think about what activities you are already doing that would qualify as a business. If you have nothing, list a few old tops on a reselling marketplace and you’ll be in business (pun intended)!